BPCE - 2018 Risk report / Pillar III

LEGAL RISKS Legal and arbitration proceedings – Natixis

MPS Foundation

In June 2014, MPS Foundation (Fondazione Monte dei Paschi di

claimed by MPS Foundation against the banks and former directors

Siena), an Italian foundation,filed a claim against11 banks, including amount to € 285 million. Natixis, which granted it financing in 2011 at the request of its previousofficers, on the grounds that the financingthus grantedwas in violation of its bylaws, which state that MPS Foundation cannot hold debt exceeding 20% of its total balance sheet. The damages

Natixis considersthese accusationsto be unfounded. Following an objection as to jurisdiction, the Tribunal of Siena referred the case to the Tribunal of Florence on February 23, 2016. The case is stillin progress beforethe Tribunal of Florence.

Formula funds Following an inspection by the AMF (French financial markets authority) in February 2015 on Natixis Asset Management’s (now Natixis IM International)compliancewith its professionalobligations, particularly the management of its formula funds, the AMF’s Enforcement Committee delivered its decision on July 25, 2017, issuing a warning and a fine of € 35 million. The Enforcement Committee found a number of failings concerning the redemption fees chargedto funds and structuringmargins. Société Wallonnedu Logement On May 17, 2013, Société Wallonne du Logement (SWL) filed a complaint against Natixis before the Charleroi Commercial Court (Belgium), contesting the legality of a swap agreement entered into between SWL and Natixis in March 2006 and requesting that it be annulled. All of SWL’s claims were dismissed in a ruling by the Charleroi Commercial Court on November 28, 2014. On September 12, 2016, the Mons Court of Appeal annulled the contested swap agreement SFF/Contango Trading SA In December 2015 the South African Strategic Fuel Fund (SFF) entered into agreements to sell certain oil reserves to several international oil traders.ContangoTradingSA (a subsidiaryof Natixis) provided funding for the deal.

Natixis IM Internationalis mounting a rigorous defense against this decisionand has filed an appeal with the FrenchCouncilof State. The case is still in progress. In addition, UFC-QUE CHOISIR, in its capacity as a consumer rights non-profit,brought claims before the Paris District Court (Tribunalde Grande Instance de Paris) on March 5, 2018, against the asset management company to obtain compensation for the financial losses suffered by the holders of the formula funds in question. The case is still in progress.

and orderedNatixis to repay to SWL the amountspaid by SWL as part of the swap agreement, less any amounts paid by Natixis to SWL under the same agreementand taking into accountany amountsthat would have been paid had the previous swap agreement not been terminated.The Court of Cassation of Belgium overturnedthis ruling on June 22, 2018.

SWL filed an appeal in February 2019.

In March 2018, SFF launched a proceeding before the South African Supreme Court (Western Cape Division, Cape Town) primarily against Natixis and ContangoTrading SA to have the agreementsinvalidated, declared null and void, and to obtain fairand equitablecompensation.

10

LucchiniSpa In March 2018 Natixis SA was summoned,jointly and severally with allegingimproprietiesin the implementationof the loan restructuring other banks, by Lucchini Spa (under extraordinaryadministration)to agreementgranted toLucchini Spa. The case is still in progress. appear before the Court of Milan, with Lucchini Spa’s receiver

195

Risk Report Pillar III 2018